In a LBO, does the debt on the lowest portion of the captial structure of the model get retired first? Or is it the credit revolver? i've seen both ways.
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The credit revolver should be retired first. Senior debt will always have requirements to be paid down before any of the subordinated debt. If the senior debt has a different paydown structure, i.e, bullet paydown instead of being amortized, then yes the sub-debt could be paid off first in that aspect.
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